Unemployment rate sinks to 5-year low

Unemployment in Los Angeles County and the state fell to five-year lows during December as the recovery continued to proceed at a modest pace last year, while giving the construction sector a healthy boost, the state said Friday.

In December the county’s jobless rate dipped to 9.2 percent from 9.5 percent in November, according to the California Employment Department. A year ago the rate was 10.3 percent.

December’s rate was the lowest since November of 2008, eleven months after the onset of the Great Recession, when it was also 9.2 percent. The rate averaged 9.8 percent for all of last year.

The state’s December rate dipped to 8.3 percent from 8.5 percent in November and was down from 9.8 percent a year earlier. Last month’s rate was the lowest since it was 8.2 percent in October 2008. For all of last year the rate averaged 8.9 percent.

“Statewide the California comeback continues. The state outpaced the nation in job growth in both November and December by a wide margin,” said Stephen Levy, director and senior economist of the Center for Continuing Study of the California Economy.

The improvement came at the perfect time for Sergio Espinoza Zamora, 25, who snagged a customer service job with Nova Property Management LLC on Dec. 2.

He lost an auto-parts sales job four months earlier and was scrambling to pay household bills and child support for a 9-year-old daughter on $360 a week unemployment.

Now he’s running the complex office, showing units to prospective tenants, taking rent payments and other tasks at the 620 unit complex not far from his own home.

“I like it. I like helping people. When they come in they are looking for answers and help,” he said. “I’ve never worked at a rental facility before so they trained me on how to talk to people and gave me some communication skills,” he said.

Zamora followed another employee around for about a month and took over a few weeks ago. When his three-month probationary period ends next month he’ll get health benefits. He’s currently making $9.50 an hour.

“It’s very important because I go for checkups when I need them and for my daughter it’s more important,” he said.

Robert Kleinhenz, chief economist at the Kyser Center for Economic Research in Los Angeles, said the state is methodically closing in on an important benchmark, the 7.5 percent average monthly rate that dates back to 1990.

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“That might be within striking distance later this year, probably toward the end of 2014,” he said.

Both the state and county posted job gains over the month, the EDD said.

Between November and December the county’s economy added 1,400 jobs and the state added 13,600.

County sectors gaining jobs over the month included trade transportation and utilities, government and professional business services, retail trade, government and wholesale trade.

For all of 2013 the county added 46,000 jobs, an increase of 1.2 percent over 2012.

Professional and business services led the way, adding 17,800 jobs.

Gains also came in educational and health services, financial activities, construction and trade transportation and utilities and government.

Job losses last year were concentrated in manufacturing and information.

Statewide full year non-farm employment increased 1.6 percent to 14.8 million from 14.5 million in 12, the EDD said.

Last year 10 sectors added jobs and one, government posted a loss.

The biggest job generator was construction, adding 28,900 jobs last year, an increase of 4.8 percent from 2012.

That trend is likely to continue this year, according to the Association of General Contractors of America.

Many firms plan to start hiring again and most contractors predict demand will either grow or remain stable in virtually every market segment this year according, to a survey it released this month.

“Contractors are more optimistic about 2014 than they have been in a long time,” Stephen E. Sandherr, the association’s CEO, said in a statement. “While the industry has a long way to go before it returns to the employment and activity levels it experienced in the middle of the last decade, conditions are heading in the right direction.”

The EDD estimates that 17 million California residents had jobs in December, up 24,000 from November and 291,000 from December 2012.

But the jobs numbers might actually be better than what EDD reports. The unemployment rate is derived from a federal survey of 5,500 California households while job growth is based on a survey of 42,000 businesses across the state.

Levy and other economists note that the monthly EDD report does not capture what is actually going on in the economy and that stronger growth is reflected in quarterly data from the federal Bureau of Labor Statistics. The state’s annual revision to the jobs data will be done later this year.

“I think these numbers understate what actually happened in 2013. I think we are definitely on the upswing,” Levy said.

The recession, which lasted 18 months and was the longest since World II, officially ended in June 2009. But the state’s recovery, job-wise, did not start until February 2012 and since then the economy has added 992,500 jobs.

California’s job growth slowed a bit last year — it was 2.4 percent in 2012 — but the pace will likely pick up this year, Kleinhenz said.

And the recovery may start to feel like one.

“We still have our work cut out in terms of adding jobs and recovering the total lost in the recession,” Kleinhenz said. “It will feel more like we’ve moved further away from the worst days of the recession. But it would be even better if we see some breakout growth occur.”